Yes to Norwich gas expansion

Published October 16. 2012 12:01AM

Norwich voters should have an easy choice in approving an $8 million bond issue Nov. 6 that will allow Norwich Public Utilities to continue with its natural gas expansion program. This program will not result in any increases for taxpayers or ratepayers. It will continue to expand the number of homes and businesses that can access cheaper and cleaner natural gas. And because continued expansion will boost revenues for the municipal utility, Norwich will benefit, since it receives 10 percent of utility revenues.

NPU began this initiative in 2010 when voters approved $3 million in bonding. That project was highly successful, adding 500 new home and business gas customers and generating $1 million annually in new revenue. Now the NPU wants to continue expanding natural gas service.

Money approved by voters serves as a line of credit. Utility officials survey neighborhoods to gauge the interest of home and business owners. When they determine there are enough new customers to make the numbers work, the utility extends the gas line into the new area. The utility offers financial assistance and incentive programs to help homes and businesses convert to natural gas use for heating and other needs.

Because of economies of scale - overhead costs do not increase proportionately to customer expansion - the new sales provide more than enough revenue to repay the bonds without raising rates.

All indicators suggest that natural gas will remain cheaper than oil as a heating source going forward. According to the Energy Information Administration, natural gas produced by drilling in domestic shale formations will grow from 25 percent of the market today to about 50 percent by 2035, keeping prices low.

Continued natural gas expansion is a great opportunity for Norwich home and business owners. We strongly urge voters to approve the question.

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